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Jun 22, 20235 min read

Why organisations fail on their Climate Adaptation strategy

By Prof. John Dora and Nick Pyatt of Climate Sense

We are entering an unpredictable future. The world’s atmosphere is reacting to increased greenhouse gas (GHG) emissions, global heating is triggering more frequent and increasingly catastrophic weather events. Add to this the slow-onset changes like sea level rise and migration of species. Current climate projections predict a 4 degree Celsius rise in average temperatures by the end of the century, despite efforts towards the 1.5 degree limit outlined in the Paris 2016 Climate Agreement.

These realisations are tangible and ever-present, and organisations of all sizes are gearing up to adapt their operations to the future – or even present – climate. But why do organisations’ climate adaptation strategies fail?

Risk Focus

Successful climate adaptation needs to be structured around risks and vulnerabilities that are affected by climate hazards. Most larger organisations keep formal risk registers that review and predict the potential risks that might affect their operations. But this in itself is not enough. Businesses that only identify climate risks - that treat this exercise as an end in itself - then archive the report once the risk has been identified, only capture a ‘snapshot in time’. Yes, someone might be allocated as owner of the risk, and work-arounds planned, but climate adaptability hinges on an organisation’s ability to react, make decisions and evolve, not a stand-alone risk assessment.

At conferences and seminars, we often hear our fellow adaptation experts tell us that what tends to be missing is the recognition that an analysis of climate risk, or vulnerability, is only part of the climate adaptation story. These ‘impact assessments’, use terminology that appears in ISO 14090, are only a small part of a successful adaptation strategy. ISO 14090 is the global best practice adaptation Standard and its guidance highlights that the impact assessment needs to be addressed alongside other influencing factors.

Indeed, ISO 14090 covers the nature of impacts - how they change over time, and how the impact of a physical hazard can be reduced, if the capability to understand and manage climate impacts improves. We know now that much best practice around climate adaptation hinges on the quality of decision-making within an organisation, and the ability to recognise that ‘long-life’ decisions are impacted by physical hazards.

To effectively navigate these long-life decisions (those decisions that will be impacted by an unseen and changing climate) agile leadership is needed; agile leadership that instils and builds adaptive decision-making and invests in the knowledge, resources and resilience of the organisation.

An impact assessment – whether a risk, or a vulnerability assessment - is not an adaptation strategy, but merely an important part. Adaptation strategies must

consider more than physical impact assessments. They must consider influencing factors such as:

· Moments when strategic decisions are made

· Governance structures and leadership

· The systemic nature of organisations

· Resources – human and financial

· Expertise and knowledge requirements

· Information and data needs

Organisation

How a business is organised can put obstacles – perceived or real – in the way of developing adaptation strategies. When an organisation sets out to develop an effective adaptation plan, we have often seen multiple departments working in siloes – each in relative isolation – that makes it difficult to gain cross-business collaboration.

Departments can be country-based or sector based, for example, and cultural norms can bring about blockers to effective adaptation strategies. ISO 14090 mentions the concept of ‘systems thinking’, which can be used to bring connectivity across diverse business units, and the language used helps to form consistency of understanding. Concentrated effort is needed to overcome obstacles and to help, collectively, to identify gaps in vital areas such as data, information and knowledge and to fill these gaps. Helpfully, the standard requires plans - resourced and funded - to help overcome organisational hurdles.

By considering adaptation needs systemically, cooperating across the whole business, long-term robust strategies can be delivered.

Knowledge gaps

One major challenge has been knowing where to start, and finding out what is or isn’t known within the business.

Questions like ‘When will we reach the climate conditions under which we need to work differently in the future?’ are pertinent – there are tangible consequences whereby unnecessary costs can be incurred by acting and adapting too early, and conversely, too late.

We have found that uncertainty borne out of a lack of knowledge can – and has – made organisations put off key decisions. This can bring an increasing chance of unexpected, costly outcomes. Making the right decision at the right time requires a few fairly simple steps; speaking with the right level of expertise, decision-makers and stakeholders is part of this. Carrying out structured decision-systems mapping exercises and understanding criticality are also part of this. Using tools such as the nine-step adaptation pathways process described in BS 8631 can greatly enhance

confidence in the timing of decisions, as can our Rapid Adaptation Pathways Analysis tool (RAPA).

Capacity and understanding

We have found that organisations need to know their current capacity to manage climate risks, and to improve they need to know what capacity they require and what steps are needed to bridge the gap between actual and required capacity. Capacity and understanding can affect organisations at corporate or at individuals’ levels – and ISO 14090 has specific requirements in this area. One way to achieve the capacity to produce a long-lasting adaptation strategy is to carry out a capacity assessment across the organisation. Software tools are available that make this a fairly straightforward exercise and this will be elaborated upon in a future Blog article. See our Capacity Diagnosis and Development tool, an innovative, economic product that can help, and quickly.

Assumed complexity

Frequently, not understanding the level of complexity involved in formulating and an adaptation strategy becomes a problem; some things are really simple, conversely some things will need to consider a huge amount of data with uncertainty, with added high risks of maladaptation from ‘lock-in’. A proportionate approach to complexity is recommended in the ISO standard.

Governance

The term ‘governance’ leads to thoughts of cumbersome corporate structures set in stone. We recognise, however that many organisations run ‘complex adaptive systems’ like transportation or energy. These organisations have flexibility built into their ‘corporate psyche’ making it perhaps easier to bring about adaptation and strategic thinking with long-term positive benefits. Our experience shows that adaptive organisations respond well to the longer-term challenges we see in climate threats. By adopting and adapting governance structures towards facilitating the involvement of top management with allocated financial and human resources, demonstrable commitment to long-term achievable adaptation strategies will follow.

Evidence of the commitment will naturally follow, as indicators and metrics - to enable the monitoring and evaluation of the trajectory of the adaptation strategy - become reported to the Board as ‘business as usual’.

Key takeaways

Climate Sense has, over the past few years, years, established expertise in climate adaptation strategy development. We recognise a number of themes that successful adaptation strategies depend upon. These themes support the development of robust, best practice adaptation strategies and plans that are compliant with ISO 14090.

These influencing factors are all interlinked and interdependent – meaning, for successful adaptation, organisations should understand and join up thinking across the following:

· Potential climate impacts